This invention relates, in general, to systems and methods for electronically processing financial transactions.
Credit card reward programs typically reward credit card customers and/or cardholders with rewards such as points or miles that are generally based on the dollar amounts of goods or services purchased using the credit card. These point rewards or reward miles are typically reflected in the cardholder's monthly statement or may be tracked by a third-party reward company which may communicate the reward totals to the cardholder in quarterly, monthly, or online statements.
Referring now to FIG. 1, a conventional credit card processing system includes a cardholder that makes a purchase from a merchant using a credit card that the cardholder acquired from the issuer, also known as the cardholder's financial institution or bank. In order to process the transaction, the merchant typically uses a point-of-sale device, which transmits a payment authorization request to the merchant's bank, also known as of the acquirer. The acquirer transmits the payment authorization request, which conventionally includes merchant identification, the credit card number, and the requested dollar amounts, to the cardholder's bank or the issuer through a transaction processing network or payment system. If the issuer determines that the authorization requests should be granted, the issuer generates an authorization response message that the request is approved, which is transmitted through the transaction processing network to the acquirer and ultimately to the merchant. The merchant then completes the transaction with the cardholder. During settlement, the acquirer pays the merchant for the cardholder's purchases, and the acquirer sends the charges over the transaction processing network to be processed by the issuer, which charges the cardholder for the purchase and reflects such charges in a cardholder statement.
In such a system of FIG. 1, the issuer may award the cardholder with points or miles based on the dollar amounts of all the transactions involving the credit card, without regard to the nature or type of transaction.
One problem with such a point based reward system is that the reward is made available to the cardholder months after the cardholder makes a purchase using the credit card. Therefore, what is needed is a system and method for providing real-time rewards for cardholders. Furthermore, what is needed is a system and methods that allows decision-making and business logic for determining cardholder rewards within various different components of a credit card processing system.